Noerr LLP: New Consumer Information Act applies for the first time to the entire consumer goods industry - Noerr: companies are not adequately prepared
(firmenpresse) - (DGAP-Media / 24.08.2012 / 13:12)
New Consumer Information Act applies for the first time to the entire
consumer goods industry - Noerr: companies are not adequately prepared
Munich, 24 August 2012.
On 1 September, the amended Consumer Information Act (VIG) comes into force
and will make it easier for every citizen, but above all consumer
organisations, competitors and media, to demand information from state
authorities as to whether companies are in breach of legal requirements on
product safety. Industry faces hard times since the Act applies for the
first time to practically all consumer goods including food and daily
requisites.
The range of companies affected is therefore enormously expanded. The
entire B2C industry must therefore anticipate that institutional applicants
will freely and comprehensively receive information on breaches of product
safety law, alleged product risks, official complaints or penalties
imposed. Reputational damage by premature media reports and unwelcome
disclosure of operational and business secrets will frequently be the
result.
'Many companies are at present only inadequately prepared to deal with such
demands for information and underestimate the consequences of the amendment
for their businesses' warns product liability law expert Dr. Arun Kapoor of
the international law firm Noerr. He advises companies to react with a
strategic communications policy to the drastically expanded right of all
comers to information, in order not to lose control over the information
given in the public media.
Expanded area of application
Apart from food and objects of daily use, all other products intended for
consumers or foreseeably capable of being used by consumers will
immediately fall under the VIG. 'Manufacturers so far did not have to fear
that authorities would, against their will, issue information about
breaches of law, product risks, complaints or product compositions. The
non-food B2C industry therefore has no experience in dealing with critical
requests for information on the basis of the VIG', said Kapoor.
Limited protection of business secrets
The rights to information under the new VIG also harbour a risk which
should not be underestimated because the protection of operational and
business secrets is drastically restricted by the amended law. So far, the
rights to information from the food and daily requisites industry were
considerably restricted if there was a danger that such secrets as
competition-relevant information could reach the public domain. From now
on, operational and business secrets no longer hinder the disclosure of
information on breaches of product safety law, official complaints and
product risks. For additional information requested by the applicant the
following applies: the relevant authority must balance the interest in the
protection of secrets in each case against the public interest in the
disclosure of the information. 'However, the authorities will in practice
only give priority to the protection of operational internal information in
the rarest cases as against the potential health protection of consumers'
said Kapoor. Consumer protection minister Aigner states in her press
release accordingly surprisingly clearly that reliance on business secrets
in future is no longer possible. Kapoor: 'This is a clear message about how
the authorities will act'.
Demand for information without obstacles
Two changes will in particular motivate the interested citizen and
institutional applicant to request information. The legislator has
drastically reduced the costs of issuing the information. Simple requests
will be dealt with by the authorities in future free of charge to a great
extent. 'The number of information requests under the VIG will therefore be
expected to increase' fears Kapoor.
Maintain control with strategic communication
Kapoor advises market participants to proactively and voluntarily answer
enquiries from institutional applicants individually on strategic grounds.
The authorities are usually obliged to hear the company affected before
they transmit the requested information to the applicant. 'Strategic public
relations work can therefore be useful in order to react with deliberately
selected, extensive information to the official hearing or even to take the
initiative of contacting the media in order to control the external effect
of the disclosure of information' said Kapoor. Information issued by the
authorities and remaining uncommented on by the relevant company, could
provoke copycat applicants to make product liability claims with the help
of the official information.
Companies are also at a risk if they themselves contact the authorities in
compliance with their notification obligation with information on
potentially dangerous products. ('self-incrimination'). Information
acquired by the authorities in this manner, while it may not in principle
be published, causes the relevant state offices to commence their own
investigations the results of which can be disclosed automatically to an
applicant.
Industry and trade should always in the future take requests for
information seriously and develop, together with their legal and
communications departments, a strategic policy for dealing with such
requests.
Noerr is a leading European commercial law firm with more than 470
professionals, five offices in Germany, seven in Central and Eastern
Europe, an office in London, one in Alicante (Spain) and a representation
in New York. Our core business is excellent legal and tax advice developing
sustainable solutions and creating added value.
End of Media Release
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Issuer: Noerr LLP
Key word(s): Law
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Datum: 24.08.2012 - 13:12 Uhr
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